FTSE 100: Bulls take charge this week

Written 3rd December 23:34

The FTSE this week (FTSE:UKX)

We tend to take absurd efforts in measuring index movement as part of our ongoing attempts to identify pressures which will effect the FTSE (UKX). Sometimes these efforts can be wasted, sometimes they bare extraordinary fruit.

We mentioned the other day relying on the USA to give a clue for coming UK direction is a waste of time.

Equally, the European indices generally do their own thing. Overnight pressures from Asia will sometimes give sufficient force to give the FTSE a firm push at the open, but usually only if there has been substantial oomph from the Nikkei or ASX.

For now, there’s a bit of a “however” making itself known due to some interesting dance steps from Japan.

Essentially, if the NK225 makes it above 23,000 points, there’s a pretty good chance from quite strong upward pressure for around 500 points.

This is the sort of thing very liable to put a spring in the FTSE’s step, especially as Japan is already painting higher highs for the first time in 20 years, and viewed on a long term path toward 27,600 as our next major point of interest.

Similarly, should Australia stumble above 6,050 points, we’re looking at longer term growth to 6,900 points commencing.

As for the Dow Jones, it’s liable to prove fascinating in the coming week with any impetus above 24,279 points. It’s easy to envisage it painting new levels of ambition just above the 24,400 point.

Meanwhile, we’re stuck with the “strong and stable” FTSE which is neither going down as far as it should nor is it gaining with any integrity.

The immediate outlook now demands the FTSE better 7,443 currently before any rise be taken seriously.

Such a motion allows for growth toward 7,483 points initially. This is liable to be quite a big deal, suggesting continued aviation history can be made in the direction of 7,550 points.

Beyond such a level, there remains sufficient impetus into the 7,600’s. If triggered, the tightest sane stop feels like it need be 7,347 points which is painfully wide.

On the flop side, below 7,288 would still concern us as 7,233 awaits, perhaps even quite a lot worse if this level breaks, as there’s a serious risk of the FTSE confirming the bottom of this year’s trading range at 7,100 points.

Alistair Strang has led high-profile and “top secret” software projects since the late 1970s and won the original John Logie Baird Award for inventors and innovators. After the financial crash, he wanted to know “how it worked” with a view to mimicking existing trading formulas and predicting what was coming next. His results speak for themselves as he continually refines the methodology.

Alistair Strang is a freelance contributor and not a direct employee of Interactive Investor. All correspondence is with Alistair Strang, who for these purposes is deemed a third-party supplier. Buying, selling and investing in shares is not without risk. Market and company movement will affect your performance and you may get back less than you invest. Neither Alistair Strang, Shareprice, or Interactive Investor will be responsible for any losses that may be incurred as a result of following a trading idea. 

This article is for information and discussion purposes only and does not form a recommendation to invest or otherwise. The value of an investment may fall. The investments referred to in this article may not be suitable for all investors, and if in doubt, an investor should seek advice from a qualified investment adviser.

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